UTI not to
sell stake in Punjab TractorsNew Delhi, February 22The Unit Trust of India said today
it had no plans to offload its stake in Punjab Tractors Ltd, to be
privatised soon. "We have no plans to sell our stake (in Punjab
Tractors). It is a good company," UTI Chairman M. Damodaran told
UNI here on the sidelines of a seminar organised by the Lal Bahadur
Shastri Institute of Management.

What does
VAT mean?WHAT
does the concept of Value Added Tax, known as VAT, mean and how this new
system is different from the existing statutes governing general levy of
sales tax? Will it add to the problems to the industry putting on it an
adverse impact or that it is going to ensure free flow of operations in
the commercial fields making the industry more competitive in the world
economic scenario, if introduced?

Chinese applicants look at postings on a
noticeboard at a job fair in Shanghai on Saturday. Shanghai Mayor expects the city’s economy to grow by 9-10 per cent this year.
— Reuters

Cyber
cafe at Mount Everest next monthKathmandu, February 22The grandson of a Nepali sherpa
in the first expedition to scale Mount Everest 50 years ago plans to
set up the world's highest Internet cafe at the mountain's base camp.

CORPORATE
NEWS

Nod to
Infosys ADR issueBangalore, February 22
Shareholders of Infosys Technologies today approved the sponsored
American Depository Receipts issue of the company in the range of 2
million to 3 million shares.

AI
profit only on paper?INDIAN Airlines, headed
by Mr Sunil Arora, exercises realistic approach in conducting the
affairs of the carrier. Officialdom does not conceal facts or indulges
in accounting jugglery. Recently, the airline has shown losses which
revealed its financial health as it exists before the year ends on
March 31, 2003.

Hasty action

Near miss

RENT
CASES

Duty of
verification
Q: Whether is it the duty of the landlord to verify records to find
out if rent was deposited regularly by tenant or is it the duty of the
Court?

New Delhi, February 22
The Unit Trust of India (UTI) said today it had no plans to offload its stake in Punjab Tractors Ltd (PTL), to be privatised soon.

"We have no plans to sell our stake (in Punjab Tractors). It is a good company," UTI Chairman M. Damodaran told UNI here on the sidelines of a seminar organised by the Lal Bahadur Shastri Institute of Management.

The UTI has a 17 per cent stake in PTL.

The Punjab Government has put 23.49 per cent shares in the company, held by the Punjab State Industrial Development Corporation (PSIDC), on block.

The government-owned mutual fund had earlier planned to tag-along its 17 per cent stake in the company along with the PSIDC’s 23.49 per cent for sale but the proposal fell through.

When asked whether the UTI might consider selling its shares in PTL if a good offer comes through, Mr Damodaran said in that scenario a number of things have to be taken into account before taking a final decision.

The country’s largest fund manager had the 19.3 per cent stake in PTL as on March, 2001, but it gradually brought it down to 17.15 by the end of September last year.

The process of selloff of the entire Punjab Government’s stake in PTL began in December last year.

The due diligence exercise of PTL, which commands 16 per cent market share for tractors, is likely to start by the end of this month. The Punjab Government has already shortlisted bidders for the company.

According to industry sources, a large number of private parties such as Eicher, Escorts, Tafe, Mahindra and New Holland have expressed interest in the company.

The company that eventually decides to buy this portion of the PTL equity will also have to make an open offer to purchase an additional 20 per cent from other shareholders.

WHAT does the concept of Value Added Tax, known as VAT, mean and how this new system is different from the existing statutes governing general levy of sales tax? Will it add to the problems to the industry putting on it an adverse impact or that it is going to ensure free flow of operations in the commercial fields making the industry more competitive in the world economic scenario, if introduced? What benefits do states coming out with their draft legislation ensure to be provided over to the industry in the event of replacement of the existing system of sales tax laws? These appear to constitute some of the important questions after the process of introduction of VAT getting intensified.

Under this new system called VAT, tax primarily is imposed on the value that a dealer either being a manufacturer or simply a trader adds to the goods purchased by him. For example, a manufacturer buys inputs valued at Rs 10,000. He incurs Rs 1000 as a cost towards processing charges thereon and sells the finished goods produced from those inputs for Rs 12000 after charging a profit of Rs 1000.

The value, in such a case, the manufacturer adds to the inputs purchased by him obviously comes to Rs 2000 (Rs 1000 towards the cost of production and another amount of Rs 1000 on account of his own profit that he realises while disposing of the goods to buyer.

Under the VAT, the manufacturer will have to pay a tax on the value of Rs 2000 that he had added to the goods bought out by him. The manufacturer’s liability to pay VAT barely is confined to the differential amount between the cost price of the goods and their corresponding sale price.

What equally is pertinent to notice here is that the manufacturer also pays VAT to the state he has actually paid to his supplier on the inputs. In this case we noticed that the price he paid to his supplier while buying the goods stood at Rs 10,000 that also included VAT element. Thus the manufacturer was virtually required to pay VAT on the entire value of the goods to the State.

On the other hand, when a person happens to be a trader is also required to pay tax on the goods traded by him, except where the goods so sold do not fall under the given schedule enlisting the exempted items. A trader too adds value to the goods that he deals in.

A person engaged in trading, both on wholesale and retail basis, usually incurs expenses in the form of freight, unloading charges, cartage etc. in relation to the goods bought out by him. After bringing the goods, he, too, sells the goods out on charging his profit. In this sense, value addition takes place in the form of expenses on goods brought to his place of business and profit that a trader realises while disposing them of by way of a sale to his customer.

For illustration, a trader buying the goods pays to his supplier, for example, Rs 5000 as their price. He then pays Rs 500 on account of freight inward, unloading and cartage while getting the goods so purchased into his stocks. He sells as such those goods for Rs 6000 that included an profit Rs 500.

Thus value that comes to be added for the purpose of VAT will come to Rs 1000, which is worked out by reducing the cost price of the goods of Rs 5000 from the sale price he gets in such a case at Rs 6000. The incidence of tax under the VAT system will fall on Rs 1000 at the rate notified by the state. The two illustrations defines what the VAT in simple terms mean.

Kathmandu, February 22
The grandson of a Nepali sherpa in the first expedition to scale Mount Everest 50 years ago plans to set up the world's highest Internet cafe at the mountain's base camp.

Tsering Gyaltsen, whose grandfather, Gyaltsen Sherpa, was in the 1953 team that helped Sir Edmund Hillary and Tenzing Norgay reach the 8,850 metre (29,040 foot) summit, hopes to open the cafe next month to cash in on a flood of visitors for the anniversary.

Thousands of trekkers and mountaineers pass through the base camp at 5,300 metres every year and many expeditions carry satellite phones into the Himalayas to run websites about their efforts and contact friends and family at home.
Reuters

Bangalore, February 22
Shareholders of Infosys Technologies today approved the sponsored American Depository Receipts issue of the company in the range of 2 million to 3 million shares.

The sponsored ADR issue, which is equivalent to 4 million to 6 million ADRs, was approved at an extraordinary general meeting held here.

“We believe the ADR conversion will make Infosys stock have more liquidity and make it to one of the mainstream stock in the United States. We believe our stock will be covered by mainstream analysts and held by well-known long-term players,” Infosys Technologies Chairman and chief mentor N R Narayana Murthy told shareholders through a video-conference from Germany.

Murthy is leading a CII business delegation that is visiting Germany.

Infosys CEO and Managing Director Nandan Nilekani told reporters that the pricing of the ADRs would be determined by the lead underwriters at a later date.

He said all shareholders holding Indian equity shares would have a “pari passu” right to participate in this offering.

Infosys Chief Financial Officer T V Mohandas Pai said 4.2 million Infosys shares were being traded on Nasdaq and the sponsored ADRs would increase the floating stock to 100 to 150 per cent. Infosys officials said Goldman Sachs, Merrill Lynch and Saloman Smiths Barney had been selected as merchant bankers for the sponsored ADRs.

Colour Chem told to pay 15 pc interest

The Securities Appellate Tribunal (SAT) has asked Clariant International, a Swiss company, to pay 15 per cent interest to investors of Colour Chem for not following the company law of making an open offer after acquiring management control of the company.

In its 26-page order on February 21, SAT upheld the earlier order passed by SEBI on October 16, 2002 wherein the latter had directed Clariant International to make an open offer to domestic shareholders of Colour Chem.

The regulatory authority also asked the erring company to pay a penal interest of 15 per cent as it had delayed in making the offer following its acquisition of Colour Chem from Hoechst, a German company.

Clariant International had challenged the SEBI order before SAT. While upholding SEBI’s order, SAT said those persons who held Colour Chem shares on February 24, 1998, would continue to be the shareholders on the closing day of the public offer to be made in terms of the directions given by SEBI.

SAT also said the dividend paid by Colour Chem to its shareholders was not required to be deducted from the interest payable to the shareholders by the Clariant International.
PTI, UNI

Mumbai, February 22
India’s foreign exchange reserves continued to rise for the 18th straight week to cross the $ 75 billion mark.

The foreign exchange reserves during the week ending February 14 rose by $ 616 million mainly due to foreign investments and export remittances at $ 75,283 million, according to the RBI’s weekly statistical supplement released here today.
PTI

CII office in Kuala Lumpur

NEW DELHI:
The CII will formally announce the opening of its tenth overseas office in Malaysian capital Kuala Lumpur during the two-day NAM Business Forum meeting starting on February 23.

The meeting, being organised on the sidelines of NAM Summit, will be addressed by Prime Minister Atal Behari Vajpayee tomorrow during the special luncheon session co-hosted by the CII.
UNI

Golden Peacock Award for Tisco

JAMSHEDPUR: Tata Steel has received the Golden Peacock Award for 2002 for the outstanding achievement for excellence in corporate governance and corporate social responsibility in the private sector category, according to the corporate communication department of the company here.
UNI

Diotek centre in city

CHANDIGARH:
Diotek India launched here today the selling of branded products through network marketing in the region. Mr Hitesh Desai, Marketing Director of the company, who was here to inaugurate the Regional Training and Service Centre, in a press conference, said Diotek India was the first Indian company, that would sell branded products of HMT, Titan, Onida, Singer, Kenstar, National, Nirlep, Kodak, WBvaristy, Thomson, Lotus and others, through network marketing.
TNS

INDIAN Airlines, headed by Mr Sunil Arora, exercises realistic approach in conducting the affairs of the carrier. Officialdom does not conceal facts or indulges in accounting jugglery. Recently, the airline has shown losses which revealed its financial health as it exists before the year ends on March 31, 2003.

Contrary are the gimmicks of Air India. The officialdom has shown a turnaround of the airline through accounting changes. Under the new
methodology, the non-operating income has been included under the operating income to project better financial health of the airline than it really is. Officials have told the government that these “innovative changes” have been introduced on the lines of the international accounting practice in the aviation sector. If this argument is accepted, why was the airline, in the previous years, not combining non-operational category into the operational income?

Aviation bigwigs are convinced that the carrier will fly smoothly only when overhead expenses are drastically slashed. There are too many people for too few aircrafts.

Unlike Indian Airlines, which owns its offices, Air India in Delhi, is housed in different buildings with a litigation going on in Scindia house. A huge rent is paid annually and there is excessive staff at two important airports, Mumbai and Delhi.

Hasty
action

Without consulting senior officials of the two carriers, the government announced a levy of tax on free and concessional air passages. The staff, supported by various unions, were up in arms. Reconciliation proceedings have been pending in Mumbai before the Regional Labour Commissioner since airlines are treated as public utility services.

Near
miss

Indian Airlines and Taiwan aircrafts had a near miss at 29,000 feet near Nagpur recently. A probe has been ordered.

Q: Whether is it the duty of the landlord to verify records to find out if rent was deposited regularly by tenant or is it the duty of the Court?

Ans: This question came up before M.P. High Court in Gopal Das Jain v Jagdish Prasad Agarwal

The facts of the case are that the appellant had filed a suit for ejectment against the respondent U/s. 12(1) of the M.P. Accommodation Control Act. The appellant filed an application U/s. 13 (6) of the Act for striking out the defence of the respondent on the ground that he has not regularly deposited the rent.

From perusal of the impugned order it appear that respondent had filed certain details about the deposit of rent and the Court granted time to the petitioner to verify the same. Appellant failed to verify the said statement and therefore, the right to verify the statement was closed by the Court.

It is needless to say, said the H.C., that there is no procedure under the law which provides for verification of the details submitted by the respondent. It is for the Court to find from its record whether the defendant has deposited the rent regularly or not?

It appears from the impugned order is pending.

It was therefore directed by the H.C. that the Court shall verify the statement submitted by the defendant and find out whether he has deposited the rent as required by S.13 and then decide the application U/s. 13 (b) of the M.P. Accommodation Control Act. With the aforesaid directions, this revision was disposed of by the
H.C.

French Finance Minister Francis Mer (C) speaks with German Finance Minister Hans Eichel (L) and
US Central Bank Governor Alan Greenspan (R) at the G7 Summit in
Paris on Saturday. Finance chiefs of the world top economies met to discuss what could be done to shore up investor confidence and business activity amid worries about war in Iraq.
— Reuters

IOC awards
Chandigarh, February 22
The Chandigarh Divisional Office of Indian Oil Corporation presented awards for excellence to its 10 high-selling petrol pumps in a dealers’ convention organised at Barog in Himachal Pradesh. The awards were presented by Mr D.P. Vaed, General Manager of the corporation. Also present on the occasion were Mr M.L. Toora, Chief
Divisional Manager of the Chandigarh Divisional Office, and Mr J.P. Khanna, president of the
Punjab Petroleum Dealers’ Association. TNS

Aquafina
Chandigarh, February 22
Pepsi, in a press statement issued yesterday, clarified that the withdrawal of the ISI mark for its Aquafina bottled water was temporary as they had been asked to explain why the company had started the production before a BIS certification was issued. The company claimed that the commercial production of bottled water at Bharuch plant in Gujarat had not yet commenced and only trial lots were being produced to test product quality in an operating plant format.
TNS

Airtel roamingNew Delhi, February 22
Full roaming on Airtel Magic will be available across 14 states in the country where the network is available. Roaming customers can make and receive voice calls throughout the country and will be able to receive and send messages while roaming in Punjab, Haryana and Delhi.
UNI

Economy to growNew Delhi, February 22
Pooh-poohing the CSO projection of 4.4 per cent growth in GDP this fiscal, Planning Commission Member N.K. Singh said the economy will grow by 6 per cent this year. Addressing a meeting here, he said “the economy will grow at the rate of 6 per cent which will further go up during the next fiscal”.
PTI

IBM centreNew Delhi, February 22
West Bengal is likely to emerge as an important IT destination with IBM agreeing to start a 200-seat development centre in Kolkata and the state government initiating dialogue with a host of
companies to start IT ventures, state IT Minister Manabendra Mukherjee said here.
PTI

UBI inks pactChandigarh, February 22
HDFC Mutual Fund has tied-up with the Union Bank of India (UBI) to distribute its mutual fund schemes across India. Initially, the marketing alliance will cover UBI’s network in Mumbai and within the next six months, the distribution partnership will be extended to the rest of the country.
TNS

Office-bearersLudhiana, February 22
Mr K.R. Tripathi of the Bank of Baroda, Ferozepore, was re-elected the president of the Indian National Bank Employees Congress at its 11th biennial conference. Dr Nitish Sen Gupta, MP, was elected the chairman and Mr Tapan Roy the general-secretary of the body.
OC

Lured by ‘chunis’Vijaywada, February 22
Indian ‘chunis,’ both silk and cotton varieties, are most sought after by women of England, Greece and Czechoslovakia, AP Handicrafts Development Corporation Managing Director B Jayaraj, who showcased the ‘Lepakshi’ brand of products at an international fair ‘Asia Export-2003’, said here.
UNI